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Skelly Oil Co. v. Archer

Supreme Court of Texas

February 21, 1962

No. A-7884

Opinion

 [*347]  [**782]   ON MOTION FOR REHEARING

On further consideration we have concluded that there is in the record no evidence of probative force to support the finding of the jury that the well on Section 292 is not producing in paying quantities.

The jury was instructed that in answering the issue it should determine whether Skelly was making a profit, though small, after deducting certain expenses, including cost of repairs and depreciation on salvable equipment. Gross income from the well over the three year period has been small indeed. There is evidence in the record of some repairs on well equipment. No doubt there is some salvable equipment which is depreciating. But there is in the record no evidence of the cost of the repairs; nor is there evidence of what equipment is salvable, the cost thereof, or a proper rate of depreciation.  [**783]  In short, there was no evidence introduced upon which the jury's answer to the issue can rest; it is [***2]  founded upon speculation and surmise. At best the evidence is nothing more than a mere scintilla, and that is not enough to support the jury's answer to the issue or the judgment terminating the lease on Section 292. Joske v. Irvine, 91 Texas 574, 44 S.W. 1059.

The error affects only the part of the judgment terminating the lease on Section 292. There is no reason why that part of the judgment may not be severed and reversed and the remainder of the judgments of the courts below be affirmed. Rule 503, Texas Rules of Civil Procedure.

 [*348]  Having concluded to reverse the judgments in so far as they terminate the lease on Section 292, we come next to the question of whether judgment should be here rendered for Skelly because of the failure of the Archers to discharge their burden of proving that the well was not producing in paying quantities or whether in the interest of justice this phase of the case should be remanded to the trial court for retrial. Rule 505, Texas Rules of Civil Procedure. Considering the record before us as a whole, we have concluded that justice will be best served by a remand for retrial. Aetna Ins. Co. v. Klein, 160 Texas 61, 325 S.W. 2d 376; [***3]  London Terrace v. McAlister, 142 Texas 608, 180 S.W. 2d 619.

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163 Tex. 336 *; 356 S.W.2d 774 **; 1962 Tex. LEXIS 776 ***; 5 Tex. Sup. J. 131; 16 Oil & Gas Rep. 650

Skelly Oil Company, Petitioner v. Gertrude L. Archer et al, Respondents

Subsequent History:  [***1]   Reported at 163 Tex. 336 at 347.

Prior History:  Original Opinion of November 29, 1961, Reported at 163 Tex. 336.

CORE TERMS

lease, rider, rent payment, acres, trial court, sentence, acreage, rentals, provisions, ambiguity, primary term, terminated, canceling, retrial